The COVID-19 pandemic has unleashed waves of untold havoc on businesses- one that can be felt across the globe. To that end, economists have predicted we could be on the cusp of a recession – or even slip into a depression. Naturally, entrepreneurs have had to shelve their dreams for time indefinite. Because who in their right minds would want to start a business at such an unstable, turbulent time?
Paradoxically, some of the biggest businesses across the world like General Motors, Burger King, CNN, Uber and Airbnb were founded during times of economic downturn in response to shifting market dynamics. Historical evidence would suggest that recessions and unstable periods present the best opportunities to start new companies.
The present day also offers once-in-a-lifetime opportunities and unfair advantages to those who dare to dream. While we are, in no way, asking you to take such a big decision without thought, we would like to present a fresh point of view - one that doesn’t leave your aspirations up in the air. Read on with an open heart and you might leave with an enlightened mind.
Let’s look at why now may be the best time to start a business:
- Access to good talent for cheap
Ask an HR executive and they’ll tell you how incredibly challenging it was to recruit and eventually close talent pre-COVID. Good candidates are sparse, and when they’re open to opportunities, they command fees that could easily bankrupt a young startup. But since COVID-19 hit, even the most established companies have had to let go of talent and cut down salaries of those remaining. This has opened up recruiting possibilities for entrepreneurs who can now access good talent critical to early stage growth at a lower cost to the company. They can also offer alternative compensation schemes like equity, as the cash compensation and bonuses become rare.
- Lower rent and overhead expenses
The fixed upfront costs to start a new company, like servers and real estate, are significant! All this before the business even makes its first penny. But today, real estate costs are down considerably and landlords are more than willing to provide attractive deal terms to close a deal. Other expenses like SaaS and consultancy services may be open to negotiation and flexible business terms as well. So, entrepreneurs can direct this extra cash towards talent acquisition and product development.
- Readily accessible consumers, thanks to digital media
You have to admit, never have more people been so willing to try new digital products and services — even if it is out of necessity. This removes the daunting challenge of acquiring customers. Not only can this be an expensive affair, but often it involves persuading consumers to choose your product over all others. It is no surprise that most startups end up failing to do so. However in the current environment, customer acquisition costs are considerably down. Due to quarantines and lockdowns, consumers are more willing to try new products and services. More importantly, as new behaviors and routines come to the fore, consumers may adopt different products and services and stick with them post pandemic.
They say you must try and fail, but never fail to try. Then pragmatically speaking, there was never a better time to fail than this. Don’t hold your passion back and lock away your trailblazing ideas because the world is topsy-turvy. Find your balance, set out, and we promise you, something good is bound to come. As it is, starting off small and learning to survive on little makes for a tougher business that can thrive despite everything.